Agent151: Exploding some myths concerning management consultants

Consultants may be expensive, and they may attract bad press, but they can also be well worth the money, argues Agent151.

“If we spend a shed-load of money on consultants to do this,” the leader of the council told me, “We’re going to get panned by the opposition and the press.” It’s easy to understand political nervousness about using management consultants, but sometimes, as in the case I am describing, consultants have a legitimate and necessary role to play.

The leader may be right about getting panned, because in the mind of Joe and Jo Public consultants are pointless fat cats, dining upon the incompetence of public sector managers, and, consequently, those who engage consultants are easy meat for lazy opponents and sub-standard journalists.

However, there are times when the case for using consultants is entirely compelling and the right thing to do is to brave the flak together and explain the business case. In the case in point, the alternative would have been to fail to deliver a balanced budget, and that would have been a much bigger disaster in all respects. “If we don’t,” I told the leader, “We’re looking at government intervention.”

Good options

“But what can consultants do for us that we can’t do for ourselves?” This is the big question, and the fact is that it is rarely the case that consultants can bring something entirely new to the table to solve a problem.

With the right amount of time, resources, culture and insight, most organisations can tackle that problem perfectly adequately. However, when organisations do not have the time, resources, culture or insight needed to solve their problem, then consultants start looking like a pretty good option.

“All they will do is regurgitate our ideas, and tell us to cut things we already know we can cut.” It’s not the only thing they will bring to the party, but sometimes having your ideas validated is all you need.

Someone else thinking it’s a good idea lends weight to your proposition. Consultants can help to flesh out the business case by providing benchmarking data and by crunching the numbers. They can also apply a methodology that they have tried and tested elsewhere: something you won’t have access to.

And contrary to the accepted wisdom, they will bring some new ideas from their dealings with others. They can also help you to change culture by working alongside your existing staff and sharing their approach and attitude.

“They’ll charge us a fortune for a bunch of graduate trainees who we’ll be training up for them.” The graduates that management consultancy firms take on are selected because they are hard-working and intelligent. They are also kept in a state of constant insecurity about their future, so they are willing to take on almost anything, no matter how unreasonable.

They are the workhorses who will gallop all night to enable you to meet those impossible deadlines. Steered by a few more senior people who actually know something about the business, they can be very effective.

Stale thinking

“We have lots of talented and enthusiastic internal people who could take this on.” Those people are great, but they are the ones who run the business now and they are needed to do the jobs they already do.

In any case, there are some problems that need a fresh pair of eyes, and by deploying internals you run the risk of stale thinking and the status quo being protected. And sometimes the problems that need to be solved are simply beyond the expertise of existing employees.

“They charge ridiculous fees for recycling work they’ve already done somewhere else.” Consultants have almost certainly done something similar somewhere else, and that is no bad thing: you get the benefit of the lessons learned from those previous attempts.

Okay, they may be doing no more than changing the names on the slides in some cases, so make sure that your contract does not pay money for old rope, but instead rewards the consultants for hitting deadlines and delivering real outputs – like budget savings.

The task of finding savings opportunities when the organisation is exhausted and out of ideas is not a pleasant one, and can provoke a good deal of negative emotion. The independence and rigor of external consultants can take some of the emotion out of the equation.

But don’t think that you can maintain your popularity with your colleagues by hiring consultants to take all the blame. If that happens, then you’ve got it wrong, and you are failing to realise all of the benefits of your investment.

A note of caution: not all consultants are good, and you need to be a great client to get the best out of them. In our case, we did employ those consultants, and they did a great job. We couldn’t have done that job ourselves. In the process we learned a good deal about our business. There was some criticism, as expected, but the leader answered it with open and transparent explanation. And we ended up with a balanced budget. “I knew it was the right thing to do,” the leader said. “Honestly, I don’t know what all the fuss was about.”

Agent151 is a senior local authority finance director and s151 officer writing exclusively for Room151.

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